There are a wide array of reward credit cards on the market, and they're not one-size-fits-all.
It's important to determine which card is best for your spending habits and needs in order to enjoy the perks of having one. Fortunately, there are more ways to figure out which reward card is ideal for you.
Here are our top picks for reward credit cards, regardless of their "theme" or category.
WalletGeek's Best Rewards Card Picks
Do You Need A Reward Card?
Are The Perks Tailored to You?
If you decide that a reward card is best for you, you’ll need to do some research on all possible reward programs. You’ll want to weigh the benefits of your personal spending against the rewards that will you get back, as well as what you get cash-back on. Someone who is fixing up a house would certainly benefit from cash-back on home renovation goods, yet someone who rents their living space would not. Additionally, there is no “perfect” reward card, as each person’s needs are individual. Some people will find that straightforward cash-back cards are the best choice for them. Traveling businesspeople or travel writers may want a card that takes their flight miles into account. For those who eat out every night, a card that offers cash-back at restaurants is excellent, while those who only cook at home would have no need for this reward. Ensure that you sign up for a reward card tailored to your needs and spending habits.
Comparing Reward Cards :
What is the card’s annual fee?
While most cash-back cards don’t charge an annual fee, credit reward cards aren’t free. Those that boast hearty perks are often those that charge a larger annual fee, particularly travel cards. The annual fee can run you anywhere between $90 and $500. For those without much disposable income, the higher end of that scale can be a bit too much of an investment. However, these fees can pay off, especially if you take full advantage of the rewards program (another reason to do your research). Sometimes, the rewards that you earn can even exceed the cost of the annual fee. Some cards only start charging an annual fee during the second year of card ownership, giving you adequate time to figure out if the rewards live up to the fee cost.
Is there a sign-up bonus?
It’s also worth considering if your reward card has a sign-up bonus. Many do, and this bonus typically offers significant rewards in the form of money, travel points, or other perks if you hit a certain spending amount in the first few months of ownership. However, if the bonus is large, it’ll require significant spending on your part. You don’t want to spend money only with the hopes of hitting the bonus. Researching the sign-up bonuses ahead of time can help you figure out if your spending habits will line up with a bonus that could award you some perks in the first few months.
Is there an introductory APR period?
When it comes to reward cards, you don’t typically want to end up carrying your balance forward into the next month. Your perks and interest will suffer. However, some cards boast a 0% introductory APR period for purchases or balance transfers. What does this mean? You’ll have a 0% interest on new purchases. This could be especially helpful if you’re planning on making a major purchase, such as a car, in the weeks after acquiring a reward card. You can put off paying any interest on pricey items as you work to pay off the money. If your card also offers a sign-up bonus, a big purchase can help you hit the necessary spending to enjoy major rewards. Win-win!
What are the perks you get with your card?
This goes beyond the rewards you get for spending. Simply being in ownership of certain types of reward cards can earn you additional perks. These perks are most commonly associated with travel cards. Those who travel frequently typically spend plenty of time at the airport, so many travel perks are established all in one place. Owning a travel reward card may provide travel fee reimbursements throughout the year, such as repayment for flights or rental car credits. You can also get your bags checked for free, enjoy priority boarding onto a flight, and typically have fees for TSA Precheck applications covered by the card issuers. Lastly, some cards offer perks through hotels, such as free nights (essentially repaying the card’s annual cost), free food, and adjusted check-in and check-out times.
Will you be charged for foreign transactions?
Whether or not you travel outside of the country can influence whether or not you’ll want a travel card or a cash-back card. While cash-back cards can be great for those living in the U.S., they typically charge around a 3% foreign transaction fee for any purchases made outside of the country. If you travel to another country for an extended period of time or make any major purchases in a different country, these fees can quickly add up. However, in most cases, travel reward cards don’t charge any additional fee for foreign purchases. This makes travel cards ideal for anyone heading out of the states.